Saudi Arabia Cancels the Sponsorship System: Everything You Need to Know About the New Law for Workers and Expats

In one of the most significant reforms in Saudi labor history, the Kingdom has officially abolished the sponsorship system (Kafala ) and replaced it with a new framework aimed at improving the work environment and attracting talent from inside and outside the country.

This decision comes as part of Saudi Vision 2030, which seeks to create a more efficient, fair, and transparent labor market.

For decades, the Kafala system shaped how the relationship between foreign workers and employers operated in Saudi Arabia. However, it faced growing criticism for restricting workers’ freedom, especially when changing jobs or leaving the country required their sponsor’s approval.

Today, the new labor system gives migrant workers greater freedom and introduces a more balanced, transparent, and digital contractual relationship between employees and employers.

In this blog, we’ll go through what the new system means, how it differs from the old Kafala model, who benefits from it, and how you can register under the new framework.

How Did the Old Sponsorship System Work?

Under the old Sponsorship system or Kafala system, a worker’s legal status was tied directly to their employer, known as the kafeel (sponsor). The sponsor was responsible for the worker’s residency, travel permissions, and contract renewals.

However, this system imposed several restrictions on foreign workers, including:

• Inability to change jobs or employers without the sponsor’s approval.
• Requirement of an exit permit from the sponsor to travel or leave the Kingdom permanently.
• Limited legal protection in case of disputes.

These limitations led to repeated calls for reform, and in 2021, the Ministry of Human Resources and Social Development launched the Labor Reform Initiative (LRI) to replace the Kafala system with a more balanced and transparent structure.

What’s in the New Labor System?

The new framework replaces the concept of a “sponsor” with a digital contractual relationship directly between the worker and employer, under the supervision of the Ministry of Human Resources and Social Development.

Here are the main changes introduced by the reform:

• Job Mobility: Workers can now move to another employer after their contract ends or even during its term under certain conditions without needing the current employer’s consent.
• Freedom to Travel: Workers can request exit and re-entry or final exit visas electronically through platforms like Qiwa or Absher, without needing a sponsor’s written approval.
• Digital Contracts: Employment contracts are now digital and standardized, clearly defining both parties’ rights and responsibilities to reduce disputes.
• Government Oversight:  The Ministry actively monitors compliance to ensure both workers and employers follow the regulations.

Who Is Covered by the New System?

The new system applies to all foreign workers in the private sector who are under Saudi labor law.

However, it does not include the following five categories:

1. Private drivers
2. Domestic workers
3. Security guards
4. Shepherds
5. Gardeners

These professions remain governed by separate domestic labor regulations.

Latest Jobs in Saudi Arabia

Eligibility Conditions

To benefit from the new system, a worker must meet several key conditions:

• Have completed at least 12 months with their current employer since entering Saudi Arabia.
• Be classified as a professional worker under Saudi labor law.
• Submit an official electronic notice to their current employer 90 days before transferring or ending the contract.

Conditions for Changing Employers

The new labor system allows job transfers in the following cases:

• When the fixed-term contract ends and is not renewed.
• After 90 days from the start of the first contract, provided proper notice is given.
• When the employer fails to meet contractual obligations, such as non-payment of wages or failure to renew the worker’s residency.

Workers must also complete all transfer procedures electronically through the Qiwa platform, in coordination with the new employer.

In exceptional cases, immediate transfer is permitted if there’s a clear breach of the worker’s rights by the current employer.

Old vs. New System: A Quick Comparison

Aspect	Old Kafala System	New Labor System
Job Change	Requires sponsor’s approval	Allowed under specific conditions
Travel / Exit Visa	Must be approved by the sponsor	Can be done electronically
Contract Type	Linked to sponsor	Digital contract between both parties
Legal Protection	Limited in some cases	Fully protected by law

Benefits of the New Sponsorship System

For Workers:

The end of the Kafala system gives foreign workers more control over their careers. Key advantages include:

• Freedom to choose and change jobs.
• Better working conditions and greater job security.
• Easier access to electronic visa services without employer interference.

For Employers:

The new system also benefits companies by:

• Attracting qualified professionals through a flexible and transparent work environment.
• Increasing productivity thanks to clear digital contracts and stable employment relationships.
• Enhancing the company’s reputation by complying with modern labor laws.

While adapting to the new system may require some effort, especially for HR teams managing electronic processes, it’s a crucial step toward modernization and fair employment practices.

How to Register in the New Labor System

All procedures are completed digitally through the official platforms:

• Qiwa Platform: Used for contract management, job transfers, and exit/re-entry visa requests.
• Absher Platform: Used for other residency and travel-related services.

Basic Registration Steps:

1. Create an account on Qiwa or Absher.
2. Enter your personal information and residency number.
3. Upload necessary documents such as your passport and a valid iqama.
   Track your application status online until approval.
   

Final Thoughts

The abolition of the Kafala system marks a major turning point for Saudi Arabia’s labor market. It’s not just a reform for foreign workers, but a step toward building a fairer, more efficient, and transparent work environment in line with Saudi Vision 2030.

Both employees and employers need to understand how the new system works and comply with its digital requirements to ensure stability and fairness in employment relationships.

And if you’re looking for job opportunities in Saudi Arabia that align with the new labor system, you can explore the latest openings on WUZZUF Saudi. We will connect you with trusted employers offering legal contracts and modern workplaces that reflect the Kingdom’s labor reforms.

FAQ